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Global steel market continues to adjust weak trend

At the beginning of October, the international steel market continued to be weak. In mid-month, the 123.3-point benchmark global steel price index fell 0.9% (a wider decline), 1.14% (from rise to fall), 6% year-on-year and 18.8% year-on-year. Among them: flat wood index 114.6 points, ring-to-ring down 0.9% (widened decline); long wood index 133.1 points, ring-to-ring down 1.3% (from rise to fall); Asian index 126.6 points, ring-to-ring down 1.1% (from rise to fall). The China index in Asia was 130.3 points, down 1% (from rising to falling); the Americas index was 142.6 points, flat; and the European index was 104.8%, down 1.4% (widening). According to the operation situation and basic situation forecast, the international steel market in the second half of October may continue to adjust the weak trend.

The Australian government contradicts BHP's forecast for steel production in China: the Australian government expects steel production in China to fall to about 800 million tons this year, to 886 million tons by 2023; BHP believes that steel production will not peak until mid-2020, perhaps as high as 1 billion tons. Mike Henry, head of BHP Billiton's Australian operations, said this year was also a year of high steel production in China and that such high production would continue for a long time, and demand for iron ore remained strong.

The Asian steel market: a slight decline. The benchmark steel price index at 126.6 in the region fell by 1.1% in the week-to-week period, by 1.5% in the month-to-month period, by 1.4% in the year-to-year period, and by 16.5% in the year-to-year period.

Flat materials: market prices have dropped significantly. In Japan, hot coil prices were $720 per ton and cold coil prices were $782 per ton in Tokyo, down $10 and $8 per ton respectively from the previous period. Medium plate $729 / ton, down 15 US dollars / ton. In mid-October, export prices of hot-rolled sheet coils were $620 per ton (FOB Japan) and $720 per ton (FOB Japan), down $10 and $15 respectively from the previous period. Galvanized sheet coils 810 US dollars / ton (FOB Japan), unchanged from the previous stage. Medium plate $670 / ton (FOB Japan), down 10 US dollars. In addition, Japan's Ministry of Economics and Industry expects that Japan's crude steel output in the fourth quarter will benefit from strong domestic demand in the automotive, industrial and construction machinery industries, and is expected to achieve year-on-year growth. Japan's Ministry of Economy and Industry forecasts that crude steel production will rise to 26.45 million tons in the fourth quarter, up 0.2% year-on-year, while production in the third quarter fell slightly. The province believes about 40% of Japan's steel output is for export. Despite the escalating Sino-US trade war and high US tariffs on imported steel, Japan's steel exports are expected to rise by 0.5% in the third quarter from a year earlier. Noriyuki Kuroda, Minister of Metal Industry of Japan's Ministry of Economy and Industry, said at a news conference that high US steel and aluminum tariffs would not have much impact on Japan's exports. The decline in Japan's exports is due to strong domestic demand, rather than high tariffs in the US. Noriyuki Kuroda also said. He also said that the Asian market still maintained healthy steel demand and was not affected by the Sino US trade war. In early October, the average export price of SS400 3-12mm hot-rolled coil was $570 per ton (FOB), down $10 per ton from the end of last month. The average export price of SPCC 1.0mm cold-rolled coil is US $620 / ton, unchanged from before. DX51D+Z 1.0mm galvanized coil exports $645 / ton (FOB), down 5 U.S. dollars / ton before the holiday. As of October 12, the import price of Southeast Asian hot coils was $570 per ton (CFR), down $5 per ton from the end of last month.

Long timber: market prices are stable or falling. In Japan, Tokyo and Osaka area rebar 606 US dollars / ton, down 5 US dollars / ton compared with before. Small steel 755 US dollars / ton, down 6 US dollars / ton before. In early October, China's HRB400 20mm rebar exports averaged $575 per ton (FOB), roughly the same as at the end of last month.

Trade relations. Indonesia has decided not to take any anti-dumping actions against imports of coloured coated aluminum-zinc coils from China and Vietnam. Kadi officials said government officials made the decision on the basis of "national interests". She said last month it had informed exporters and embassies and other relevant parties of the decision, but declined to give details.

Brief Measurement: Based on the basic situation of Asian and Chinese markets, the Asian steel market in the second half of October is forecast to continue weak trend.

The European steel market continues to decline. The benchmark steel price index of 104.8 in the region fell by 1.4% (from rising to falling), fell by 1.4% (widening), rose by 1% (parity with the previous), and rose by 17.5% year-on-year.

Flat materials: market prices fell slightly. In the European Union, the factory price of hot rolled coil is 650 US dollars / ton, which is basically the same as last month. The factory price of cold-rolled coils was $740 / ton, down by 5-8 US dollars / ton at the end of last month. As of October 12th, the import price of the EU hot rolled coil was 600 US dollars / ton (CFR), which is basically the same as last month. The import price of cold rolled coil is 705 US dollars / ton (CFR), down 5 US dollars / ton before. In the CIS, the price of hot and cold rolled coils continued to decline by US $5-10 / ton. Market participants said that demand had fallen sharply, while coils in the import market appeared to be over-saturated, and that the recent unsuccessful attempt to raise steel prices had raised concerns about the local market conditions in the region. At present, many rolls are quoted at 560-570 US dollars / ton CFR, depending on the origin. Some traders said that the Russian steel mill intentionally quoted $530-540 per ton fob for hot rolled coil and counteroffer $520-525 per ton fob. Market participants say that Turkey is importing heat.
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